Ars is reporting that the National Association of Broadcasters and the RIAA are in talks to strike a compromise that could result in a Congressional mandate to include FM radios in phones and other portable electronics. Thanks but no thanks?

Here's the setup: Under the current, longstanding framework, FM radio broadcasters do not have to pay artists and record labels performance rights—a significant fee that satellite and web radio services must pay—when they play a song on air. A bill currently winding its way through Congress, the Performance Rights Act, would force FM radio stations to pay up, too, though they think that they should be exempt, as they are essentially just promoting the artists to begin with.

But the two groups are flirting with a compromise that could lessen radio broadcasters' fee (to the tune of a more manageable $100 million a year) in exchange for a mandate from Congress that all phones, PDAs, and other portable electronics must contain FM radio chips. MusicFIRST, a lobbying group of which RIAA is a member, says that such a mandate would give customers more music choices. Hmm? Gary Shaprio, president of the Consumer Electornics Assocation, says "to have Congress mandate broadcast radios in portable devices, including mobile phones, is the height of absurdity." Yes, that's a bit more like it.

It's clear that the music industry, as it exists currently, needs to change drastically. But this type of behavior—essentially trying to stuff the most cutting-edge gadgets with guts for an increasingly outdated and outmoded broadcast platform—show that the lumbering recording industry giants are still thinking like lumbering giants. Maybe they'll finally wisen up, or go extinct, next year. [Ars]